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Monday, April 04, 2011

A populist warning light?

A new opinion poll shows that Austrian, anti-immigrant, populist party FPÖ would end up on top if elections were held today, beating both the social democratic SPÖ and conservative ÖVP. There are of course multiple reasons for the party's rise, but we note that FPÖ leader Heinz-Christian Strachewhich last week slammed Austria's participation in, and the cost of, eurozone bail-outs. "Thank you, [Austrian Chancellor] Werner Faymannm," he said sarcastically.

In Finland, the "True Finns" party, under the leadership of Timo Soini (pictured), has seemingly come from nowhereand transformed itself into a full-scale political force. A recent opinion poll put it second, ahead of this month's national elections. Though not nearly as bad as FPÖ, it does run on a highly populist platform with a strong anti-euro flavour. The party was almost single-handedly responsible for derailing the EU deal on how to increase the size of the eurozone's bailout fund, the EFSF. The decision is now postponed until June, after the Finnish elections. And as Jan Sundberg, Professor at University of Helisnki puts it, "Portugal crashing would be a gift to the True Finns".

In the Netherlands, the government does not have a majority in Parliament, but has to rely on Geert Wilders' Party for Freedom, which is the third largest party in the country. Wilders has also spoken out against the euro-bailouts. So far, the Dutch government has relied on the other Dutch opposition parties to get its EU measures though parliament.

"They promised us that this currency would bring growth and welfare, and what happened? People were destroyed, we are talking about a real tragedy. Look at what happened to Greece."

Again, there are numerous factors at work here - and we should be careful to over-simplify or generalise - but it's hard not to detect a worrying trend: four of the eurozone's main creditor countries (and incidentally net contributors to the EU budget), which are underwriting struggling euro governments' debt to the tune of hundreds of billions, are experiencing a dramatic surge in support for populist parties. These parties would not only reject the bail-outs and the Single Currency but also, in all likelihood, the EU itself.

So what about the big kid on the block: Germany?

Germany doesn't really have its own version of the populist parties we see in other parts of Europe - on the left, Die Linke might fit part of the bill, but it's still not quite the same. Therefore, there's no real political platform for the kind of aggressive anti-euro sentiments that we see in Austria for example (which also plays on anti-immigration and anti-incumbency) - and there's unlikely to be one in the immediate future.

It's clear, however, that German public opinion is growing increasingly wary of the direction of the euro. Slowly, these sentiments are beginning to trickle through to party politics. The motion which was passed by a near-unanimous German Parliament asking Merkel to backtrack on an agreement between eurozone leaders, is one example (though it shouldn't be overstated either). But there clearly is a vacuum in EU politics in terms of voicing alternative visions for the direction of the Single Currency and the EU - and a mismatch between public opinion and the political class.

Writing in FTD last week, Wolfgang Münchau - who, until recently, was the arch-optimist amongst eurozone commentators - argued that "a right-wing spot is free" in Germany. He suggested that the liberal FDP will fill the vacuum and turn into a 'eurosceptic' party. Perhaps. If so, the hope is that the FDP could transform itself into a sensible, EU reformist party, pushing for the revolutionary idea (yes, sarcasm) that the single currency and the EU should be based on sound economics and democracy. Such an outcome would benefit both Germany and Europe.

The fear, as ever, is that the vacuum will be filled by other, nastier political forces.

A Europe in which populist, anti-immigrant parties hold strong positions in creditor (or triple A countries), while far-left parties gain prominence in debtor nations such as Greece or Portugal, would really be the worst of all worlds.

But if Europe's mainstream politicians continue to stick their heads in the sand, and refuse to speak about the problems facing the eurozone - they should not be surprised if voters turn to the parties that do engage in some straight talking, however flawed or nasty such talk may be.

Mainstream political parties and their leaders got it spectacularly wrong on the euro in the past. Perhaps it's time to think about some more fundamental solutions to the eurozone's problems?

6 comments:

J.E.
said...

Hi,

I certainly wouldn't call the FN a "populist" party -- they are more like an "unpopular" party. Despite the dodgy polls by Harris Interactive which caused a panic in the French media, in the recent local elections ("cantonnales") the FN had a very mediocre score, two Conseillers Generaux out of 2023, which is less than in their "better" years (3 in 1998 and 1994) and only 11,73% of the vote, which contrasts with the enormously inflated figures given by Harris Interactive.

I feel that the media is promoting the FN and Marine Le Pen in order to repeat a 2002 scenario opposing an unpopular mainstream candidate (Dominique Strauss-Kahn) to an unacceptable, extreme-right candidate (Marine Le Pen) in order to herd the voters into granting DSK a landslide victory. Of course, the mainstream media is already presenting the UMP as divided, which will probably lead to it shooting itself in the foot with two rival candidatures leading to the FN making it to the second turn. It certainly got Chirac elected back in 2002.

I believe the FN is popular right now because it's a convenient tool to get Strauss-Kahn elected.

You're right that the performance of FN in the local elections was well below the figures which are now flying around (though they didn;t actually run in all cantons.

Regarding the Harris Interactive poll you mention, again, you're right. The first round was clearly flawed, since it didn’t consider DSK and François Hollande as possible Socialist candidates. However, they did the whole exercise again, with Marine Le Pen again coming out on top. Other polls have also confirmed FN’s popularity. Our point is that there are a lot of unhappy UMP voters out there - just as there are plenty of voters unhappy about the mainstream options in the other countries we highlight - who are now looking to alternative parties. The rise of these parties pose a huge challenge to the EU and the eurozone.

The problem is that these populist parties are completely statits. I am French and I can tell you that here in France, every politician who is against the euro, particularly the new FN of Marine le Pen, wants to return to national currency so that the government will be able to have a complete control on this currency. They want to weaken the currency in order to reduce the national debt, so that they can continue public spending and socialist policies. They don't seem to understand what happened to Greece.

The French electorate used the Front National before to send a message to the politicians of the main parties and to President Chirac. Since then the French have voted "non" to the Lisbon Treaty, only to see their democratic voice ignored once again.Perhaps this time round the French will shout their message a little more loudly. The current eurozone and Schengen problems are causing anxiety.

Simply ask USA to increase their Debt to at least 50% of their National Reserve.Then USA should call International Minister of Finance meeting and demand all the Nations to issue 50% more of their currency.

By doing above, USA no longer has debt, poor nations government got 50% more money, which can spend to elevate lowest of lowest citizen;s lifestyle, got money to by foreign good from G* nations which over produces Edible Goods and Durable Goods, what will brings Economic Boom

To my mind, if a party has managed to gain such popularity as FPÖ in Austria, it suggests something that relates to people who support it, and it means the party has some influence, power and potential - the same with all the other countries mentioned, and there is nothing surprising about that.